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Sunday, March 3, 2013

Saving for Tomorrow

Due to some recent events, I have decided to tighten my belt with my finances.
In a previous post, I talked about budgeting and how you can use tools to plan your financial
outlook. In this post I will talk specifically about why I want to start saving
more and how I might go about it. There are 3 reasons why I have now made
saving a priority.

The first reason for my version of austerity has been the increasing amount
of traveling that I have been doing the past couple of months. My new job has
given me an opportunity to go places that I didn't dream of going a year ago
and as such I have been addicted to flying to more and more exotic places. Upon
a closer look at how much I spent, airfare and travel expenses have revealed
that I tend to be a bit careless especially on food. I really need to start
saving more and budgeting for travel expenses in order to continue to travel
without worrying about money.

Second reason that I am going on thrifty diet is that I want to save for a
house someday. I talked before about the rising cost of living in Silicon Valley. I would have to
save almost +100k in order to pay just a down payment on a house. With housing
prices in the +500k, I don't think I will be buying a house anytime soon, but I
do want to plan for it. It is really depressing to think about how much I would
have to save for the chance to pay a mortgage, just a chance. Inventory
for houses in this area are very low. People are overpaying for the ability to
get their kids in a great school district and competition for houses has been quite
fierce.

Lastly, my parents are currently in the process of buying a new car and they
want me to help them with a down payment. I have been using their car for many
years without paying them and now that I have a job, it is time for me to give
back to them. It’s not a problem except that I didn't really plan it in my
finances to give my parents this money. It will be tough to allocate monthly
payments to them presently.

Some of the ways that I have been think about how to go about saving is to
cut all unnecessary expenses. I recently stopped a magazine subscription that I
had for 3 years to save about a $100 bucks a year. I was rarely reading these
magazines that are just sitting on coffee table and I would get one every week,
they would pile up and be stuck in a corner somewhere, forever. I am also
looking into sticking with my planned budget for eating out. I have always had
my limit for food expenses but I would routinely go over that amount, I have to
be more disciplined at following my own budget.

As a work around to saving more, I could also focus on earning more. The
reality is that one can only save so much before there is no more money to
save. I have been actively trying to find a part-time job that can provide me
with some on the side. So far it has been rough going as there are a lot of
jobs that either doesn’t fit the time constraints or the experience necessary.

I will update you guys on my saving progress as well as new ventures that I
am planning for the future. If you have any ideas on saving and budgeting, feel
free to leave me a comment below.